Anna Wu on MPF reform: fee cuts, semi-portability and a central database — three arrows

MPFA chair Anna Wu briefed the media on multiple MPF reforms: fee cuts, semi- and full portability, a central database, fee disclosure, early withdrawal and offsetting — with timetables for each.

What’s new on fee cuts?

An independent consultant will study charges; scale and competition will do the rest. The Fund Expense Ratio fell from 2.13% to 1.83% over the decade — not enough, Wu says. A consultant appointed in October will probe high admin costs, reporting by mid-next year; meanwhile growing assets bring economies of scale and semi-portability brings competition — a two-pronged squeeze on fees.

When do semi- and full portability arrive?

Semi-portability by end-2012; full portability is the long-term goal. Semi-portability lets employees move contributions yearly; eventually the MPFA wants full portability covering the employer portion too — no timetable yet.

What is the central database?

A centralised MPF administration platform that could slash admin costs. The MPFA is studying a central database to unify contribution and transfer processing, cutting duplicated manpower and aiding fee cuts long-term.

How will fee disclosure improve?

Fund fact sheets must be clearer — fees at a glance. Disclosure rules will be tightened for readability; eMPF-style digital tools will help members manage accounts. Early withdrawal has been reviewed by a working group; offsetting sits with the policy bureau for the government to decide.

To compare fund fees ahead of semi-portability, visit MPF fund comparison.